Capital Structure and Financial Performance of Listed Pharmaceutical Enterprises Nigerian Experience

This study investigated the association between capital structure and financial performance of listed pharmaceutical enterprises in Nigeria. The specific objectives of the study were, among others, to ascertain the relationship between short term debt and returns on assets of listed pharmaceutical firms in Nigeria; the relationship between short term debt and earnings per share of listed pharmaceutical firms in Nigeria. The study design was ex-post facto, with a population of five (5) listed pharmaceutical firms in Nigeria, same as the sample size for the study. Data for the study was secondary data obtained from published financial statements of firms for over the past 6 years. Descriptive statistics was used to address the research questions, while Pearson product moment correlation coefficient connected with multiple regression was employed to assess the hypotheses with the aid of SPSS, version 21. Findings revealed that these is a positive moderate association between long term debt and return on asset. This is also positive weak association between retained profits and return on assets among others. It was concluded that the firms long term debt level has favourable association with financial success.
It was however, recommended pharmaceutical firms should make use of moderate level of long-term debt obligation since it yields moderate level of returns, and firms should use long term debt over short term debt in financing their operations and asset acquisition to boost their profitability